DraftKings Interested In Acquiring Entain

DraftKings Interested In Acquiring Entain

Confirming media reports, Entain has confirmed the interest by DraftKings, the sports wagering and fantasy and gaming operator in acquiring the company. In a statement issued by Entain, the board of directors of the company has confirmed the proposal received by the FTSE 100 by DraftKings. The statement also stated that any takeover would involve a combination of stock and cash. However, it was further clarified that there cannot be any certainty as regards a firm offer nor as regards the terms of the acquisition.

Rules regarding acquisition

As per Rule 2.7 of the City Code with respect to Mergers and Takeovers, DraftKings has time until 5:00 pm on October 19, 2021, to announce the intention of the firm as regards making of an offer to Entain or in the alternative to announce that no offer shall be made. In a statement by Entian, it was mentioned that as per Rule  2.6 (c) of the City Code, the deadline can only be extended with the consent of the panel and has stated that the announcement has been made without discussing the same with DraftKings.

Other operators and the takeover

MGM Resorts, the operator of BetMGM joint venture with Entian has also claimed awareness in a statement as regards the offer. The statement also stated that the consequence of any deal between Entian and DraftKings would be the creation of a competing business in the United States. This would require consent by MGM and that the company believes that control of the BetMGM joint venture is extremely important with respect to the achievement of the strategic objectives of the company.

Earlier Reports

CNBC had reported earlier that DraftKings has made a $20 billion offer and had also reported that the transaction would be concluded on the basis of the stock. MGM had earlier made an unsuccessful attempt to acquire the company in the last twelve months. This is the second such offer received by the company. In January 2021, MGM had made an offer to Entian of 0.6 MGM shares for each Entian share. This represented a 22% premium on the share price or 1383 pence per share. This offer was rejected as there was a thought that the offer had undervalued to a significant extent the value of the growth prospects of the company.

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About sherlock

Sherlock Gomes loves to write and express his views on anything related to Gaming, Gambling, & Casino. He has been covering Gaming for more than two years now.